Economy of Edinburgh

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Edinburgh, the capital city of Scotland, is a powerhouse of the Scottish economy, as well as the wider UK economy. Edinburgh has been consistently one of the most prosperous parts of the country and has the strongest economy of any city in the UK outside London. Financial Times FDi Magazine has named Edinburgh as the "Best Large European City of the Future" and "Best Foreign Direct Investment Strategy (Large City)" for 2012/13. Edinburgh was ranked the 13th largest financial centre internationally and the 4th largest in Europe in 2020.

In 2011, the population of Edinburgh was estimated at 476,600, which was an increase of 28,000 on the figure from 2001 which stood at 448,600. The city has the second highest gross value added (GVA) per resident (behind London) in major UK cities, with the average being £34,178 per resident. The employment rate for the city stood at 73.6% for Q1 of 2013, which was higher than the rate for Scotland as a whole, which stood at 71.8%. The city has the lowest percentage of total working age residents claiming Jobseeker's Allowance of major UK cities at 3.2% as of December 2012. Edinburgh is second only to London in average gross annual earnings per resident in major UK cities, with an average salary of £27,800.

Edinburgh has an estimated 17,136 people working within digital companies. The technology sector has grown upon the expertise within the city’s universities. The city has seen a growth in the number of software companies in the city over the last 10 years and there are now more than 100. These include travel search website Skyscanner and one day fantasy sports provider FanDuel who have grow within the city. Rockstar North (formerly DMA Design), known for creating the Grand Theft Auto series, is also based in Edinburgh. Several large corporates have invested in Edinburgh including Amazon Development Centre Scotland and Microsoft. The School of Informatics is the UK’s largest and longest established research group in informatics. In the REF 2014 assessment for computer science and informatics the School of Informatics has produced more "world leading" and "internationally excellent" research (4* and 3 star) than any other university in the UK. A large number of technology companies are based in the area around the University of Edinburgh.

Edinburgh has not had as large or as significant a retail sector compared to Glasgow, however large out of town shopping developments have taken place in recent years, such as the Gyle development in 1993 and the Fort Kinnaird shopping complex located to the east of the city. The St. James Centre and Princes Mall started in the 1970s, then Cameron Toll in the 1980s. More recent developments are the Gyle centre next to Edinburgh Park, Ocean Terminal in Leith and the retail parks at Hermiston Gait, Straiton and Fort Kinnaird which are all next to the Edinburgh City Bypass. Edinburgh has many modern supermarkets in its suburbs which offer a more day to day type of shopping. As a shopping centre, particularly Princes Street, Edinburgh suffered some decline for a number of years, but since 2005 has seen the City centre yield rise in comparison to other similarly sized cities. Recent attempts to encourage shoppers back into the city centre have included the development of top brand department stores on George Street and St Andrew Square and plans to redevelop Princes Street in the future. In October 2016, the St. James Centre was demolished and rebuilt with a new £1 billion design by Allan Murray Architects and BDP Architects, and was opened to the public in June 2021. It was renamed the St James Quarter and is able to accommodate up to 80 new brands. While it brought a new excitement to the city with many new brands appearing within the quarter, it caused many brands located in Princes Street to relocate to the St James Quarter, undermining the hopes to revitalise the street. St James Quarter was designed to be in the shape of an eye, with the 5 star W Hotels taking pride of place in the 'iris'. This central feature, however, caused a lot of controversy in the city and even put Edinburgh's UNESCO World Heritage status under threat.

The city is linked internationally by Edinburgh Airport (EDI) which in 2018 saw 14.3 million passengers throughout the year, which makes Edinburgh Airport the busiest Scottish Airport and sixth busiest in the UK. In terms of rail connections, Edinburgh Waverley railway station is the principal mainline station in the city serving over 22.5 million passenger journeys over 2011–12. The city is also well served by its bus service, with Lothian Buses having its headquarters in Edinburgh. Over 70 services run throughout the city, which includes a direct link to the airport and open top buses for city tours. The first phase of the Edinburgh Trams was completed in May 2014, consisting of 16 tram stops along the single 14 km (8.7 mi) line. The route linked Edinburgh Airport in the West, to York Place in the East. The second phase of the Edinburgh Tram development was competed in June 2023 and added a further 8 stops from Picardy Place, which replaced the former York Place stop, to Newhaven in Leith, extending the line to 18.5 km (11.5 mi). There are plans to build new lines to Granton, the Royal Infirmary of Edinburgh, and Musselburgh but nothing is certain at the moment.

Derelict land and areas on the waterfront of Edinburgh at places like Granton and Leith are in the process of being regenerated to make way for mixed commercial, residential and industrial developments to further provide for the forecast growth of the city.

In an economic sense Edinburgh is constrained by its relatively small size, and that there are economic benefits to be had with greater collaboration with surrounding areas such as Glasgow. Edinburgh itself is ringed by greenbelt land, which has seen developments such as the offices at Edinburgh Park and housing and commercial developments to the south of Edinburgh spring up on it.